Earnings Outlook
Shriram Fin Jan-Mar PAT seen up 12% on steady AUM growth
This story was originally published at 15:06 IST on 22 April 2025
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By Pratiksha
NEW DELHI – Shriram Finance Ltd.'s net profit for Jan-Mar is expected to rise 11.5% on year to INR 21.70 billion owing to stable growth in assets under management, according to the average of estimates from 11 brokerages. Sequentially, however, the net profit is expected to decline by over 39%.
The Chennai-based non-banking finance company, which will release its March quarter financial results Friday, had reported a net profit of INR 35.70 billion for Oct-Dec owing to a one-time post-tax gain of INR 14.89 billion from the sale of its stake in a housing finance subsidiary. The estimates for Shriram Finance's net profit for the March quarter range from INR 18.95 billion to INR 23.07 billion.
Equirius Securities expects Shriram Finance to have registered growth in assets under management of around 19% on year in the March quarter. ICICI Securities expects the assets under management to have grown 17% on year, and IDBI Capital sees them up 18% on year.
The company's assets under management rose 18.8% on year to INR 2.54 trillion as of Dec. 31. Of the total assets under management, the shares of the commercial vehicle, passenger vehicle, and micro, small, and medium enterprise segments were 45.5%, 20.4%, and 13.6%, respectively, in the December quarter. The gold loan and personal loan segments contributed growth of 2.2% and 3.4%, respectively, to the lender's total assets under management.
Kotak Institutional Equities expects Shriram Finance to report loan growth of 4.3% on quarter and 18% on year for Jan-Mar, while Nirmal Bang Equities sees advances growing 4.9% on quarter and 18.6% on year.
The company's net interest income for the reporting quarter is expected to have risen by 9.4% on year to INR 58.40 billion, according to the average of estimates from 11 brokerages. In Oct-Dec, the company's net interest income rose 14.3% on year to INR 58.23 billion.
In Jan-Mar, the company's net interest margin is expected to remain steady on quarter at 8.50%, Equirius Securities said in a pre-earnings report. Shriram Finance's net interest margin moderated to 8.48% in Oct-Dec. Nuvama Institutional Equities sees the company's net interest margin at 8.60% in the March quarter.
Analysts will keep a keen eye on Shriram Finance's commentary on growth in assets under management and margin in the financial year 2025-26 (Apr-Mar) and guidance on asset quality and credit cost. At 1443 IST, shares of Shriram Finance were up 0.4% at INR 705.90 on the National Stock Exchange.
Following are the Jan-Mar earnings estimates for Shriram Finance based on reports from 11 broking firms in descending order of net profit estimates:
|
BROKERAGE |
NET INTEREST INCOME |
NET PROFIT |
| Nirmal Bang Equities Pvt. Ltd. | 58.225.00 | 23,065.00 |
| Nomura Equity Research | 59,300.00 | 22,300.00 |
| IDBI Capital Market Services Ltd. | 57,192.00 | 22,155.00 |
| Centrum Broking Ltd. | 58,482.00 | 22,067.00 |
| Kotak Institutional Equities | 57,796.00 | 22,026.00 |
| JM Financial Institutional Securities Pvt. Ltd. | 59,592.00 | 21,950.00 |
| PhillipCapital (India) Pvt. Ltd. | 56,443.00 | 21,752.00 |
| Motilal Oswal Financial Services Ltd. | 57,847.00 | 21,619.00 |
|
ICICI Securities Ltd. |
57,782.00 | 21,484.00 |
|
Elara Securities (India) Pvt. Ltd. |
61,053.00 | 21,375.00 |
|
Equirus Securities Pvt. Ltd. |
58,640.00 | 18,953.00 |
|
Average |
58,395.64 | 21,704.18 |
End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Rajeev Pai
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